Brown & Brown, Inc. (NYSE:BRO) has experienced a decrease in hedge fund sentiment recently.
In the 21st century investor’s toolkit, there are many indicators shareholders can use to analyze stocks. Some of the most underrated are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best hedge fund managers can outperform their index-focused peers by a superb amount (see just how much).
Equally as integral, optimistic insider trading sentiment is another way to parse down the stock market universe. There are a variety of incentives for an insider to cut shares of his or her company, but just one, very obvious reason why they would buy. Many academic studies have demonstrated the useful potential of this strategy if shareholders understand what to do (learn more here).
Keeping this in mind, let’s take a look at the key action surrounding Brown & Brown, Inc. (NYSE:BRO).
Hedge fund activity in Brown & Brown, Inc. (NYSE:BRO)
At Q1’s end, a total of 18 of the hedge funds we track were bullish in this stock, a change of -5% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their holdings significantly.
When looking at the hedgies we track, Citadel Investment Group, managed by Ken Griffin, holds the most valuable position in Brown & Brown, Inc. (NYSE:BRO). Citadel Investment Group has a $99.2 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Generation Investment Management, managed by David Blood and Al Gore, which held a $78.4 million position; the fund has 1.6% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include Donald Chiboucis’s Columbus Circle Investors, Chuck Royce’s Royce & Associates and Anand Parekh’s Alyeska Investment Group.
Seeing as Brown & Brown, Inc. (NYSE:BRO) has witnessed bearish sentiment from the aggregate hedge fund industry, it’s easy to see that there exists a select few fund managers that slashed their positions entirely heading into Q2. Interestingly, Eric D. Hovde’s Hovde Capital dumped the biggest position of the 450+ funds we watch, valued at close to $4.1 million in stock., and Matthew Tewksbury of Stevens Capital Management was right behind this move, as the fund cut about $0.8 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 1 funds heading into Q2.
How are insiders trading Brown & Brown, Inc. (NYSE:BRO)?
Bullish insider trading is particularly usable when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time frame, Brown & Brown, Inc. (NYSE:BRO) has experienced 1 unique insiders purchasing, and 8 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Brown & Brown, Inc. (NYSE:BRO). These stocks are Marsh & McLennan Companies, Inc. (NYSE:MMC), Aon PLC (NYSE:AON), Willis Group Holdings PLC (NYSE:WSH), Erie Indemnity Company (NASDAQ:ERIE), and Arthur J. Gallagher & Co. (NYSE:AJG). This group of stocks are in the insurance brokers industry and their market caps resemble BRO’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Marsh & McLennan Companies, Inc. (NYSE:MMC)||24||1||9|
|Aon PLC (NYSE:AON)||31||1||6|
|Willis Group Holdings PLC (NYSE:WSH)||19||0||13|
|Erie Indemnity Company (NASDAQ:ERIE)||7||1||2|
|Arthur J. Gallagher & Co. (NYSE:AJG)||21||0||12|
With the returns shown by our studies, retail investors must always keep an eye on hedge fund and insider trading activity, and Brown & Brown, Inc. (NYSE:BRO) shareholders fit into this picture quite nicely.